Negotiation

The ‘wise owl’ is politically intelligent, and will always aim for
win-win.

Winning and losing

Negotiations can potentially end up with one of several outcomes, ranging from win-win to lose-lose.

Why should win-win be my preferred goal?

While conflict is invariably present in negotiations, these days there’s a much greater emphasis on
seeking to achieve a win-win outcome wherever possible. In other words, whatever the issue over which you
are negotiating, you should look to achieve a mutually beneficial or acceptable outcome.

The Harvard Project on Negotiation (see Ury, Fisher and Patton, Getting to Yes in Want to know more?) is based upon a win-win approach which
adopts ‘principled negotiation’ or ‘mutual gains bargaining’. Here, negotiation is
seen as essentially a problem-solving process. This is the approach that we are advocating here.

From win-win to lose-lose

My father said: ‘You must never try to make all the money that’s in a deal. Let the other
fellow make some money too, because if you have a reputation for always making all the money, you won’t
have many deals.’

J Paul Getty

You should always aim for a skilful win-win outcome wherever possible. We cannot stress this point too
often.

Win-win is the most desirable outcome of, and approach to, negotiations. In his book The Seven Habits of
Highly Effective People (see Want to know more?), Stephen
Covey identifies win-win as one of six paradigms of human
interaction. These paradigms, which are inherent in games theory, are

Win-win (interdependence)

Win-win or no deal

Win (independence)

Win-lose

Lose-win (dependence)

Lose-lose.

The following table explains each of these paradigms in more detail as they relate to negotiation.

Six paradigms of human interaction

Features and consequences

Win-win (interdependence)

A win-win paradigm is beneficial to all parties, based upon a shared belief
that there’s a better way of doing things and a shared desire to find it. This winning outcome
is a result of the mutual competent use of negotiation skills and a predisposition to behave
interdependently. This is interdependence at its best and it’s a view that’s
based upon three key assumptions:

Success depends upon cooperation with other people

There are sufficient gains and resources for everyone to share

Cooperation is more likely than confrontation to achieve a successful outcome.

Win-win or no deal

A win-win or no deal paradigm is evident in attempted negotiations where
none of the parties can find a mutually beneficial solution, so they agree to disagree amicably.
This often happens at the early stages of negotiating a business relationship.

Win (independence)

A win paradigm is a context in which one party wins without regard to the
cost to, or the feelings of, other parties. It’s still very common in the business world, and
the likely consequences are similar to those of a win-lose paradigm or outcome (see no 4).
This is independence in its most obvious form. The danger here is that the other
- ‘defeated’ - party will seek revenge at a later stage.

Win-lose

A win-lose paradigm is evident when one party uses its power, resources or
authority in an attempt to win at the expense of the other parties. The party that’s operating
within this paradigm is often described as ‘playing hardball’.
This approach is clearly not compatible with mutuality or interdependence and is likely to preclude
any further negotiations between the parties concerned. However, the reactions of the losing party
may not be as extreme as in a win outcome.

Lose-win (dependence)

A lose-win paradigm is characterised by appeasement, placation, abandonment
or submission. It’s the opposite pole of win-lose, and it’s not uncommon for managers
(and others) to operate within these two extreme paradigms at different times. Lose-win is dependence
at its most obvious.

Lose-lose

A lose-lose paradigm may be created if the parties involved are each
playing a win-lose game. The outcome is the result of incompetent negotiation and a common attitude
of dependence.

Why win-win is not a soft option

Trust, self-interest and negotiating expertise constitute the glue that holds negotiations together. Once
these bonds are loosened, it is difficult to get round the table again.

In today’s fast moving business world, it’s tempting to think that the only place for
personal relationships is when we are off duty – but if that is your view, then think again.
People do business with people they like. In ‘win-win’ negotiation, positive relationships
with colleagues are fundamental and the best results are achieved by people who are genuinely interested
in their clients.